New Orleans Man Pleads Guilty for His Role in Scheme to Defraud Medicare by Soliciting Kickback Payments for Two New Orleans-Area Physicians

A New Orleans, Louisiana, man pleaded guilty today for his role in a scheme to solicit the payment of illegal health care kickbacks to several individuals, including two New Orleans-area physicians, for the referring and certifying of individuals for medically unnecessary home health services.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Peter G. Strasser of the Eastern District of Louisiana, Special Agent in Charge Eric J. Rommal of the FBI’s New Orleans Field Office and Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Dallas Field Office made the announcement.

Joseph A. Haynes, 63, pleaded guilty before U.S. District Judge Barry W. Ashe of the Eastern District of Louisiana to one count of conspiracy to solicit and receive health care kickbacks and bribes.  Sentencing is set for Aug. 22 before Judge Ashe.

In pleading guilty, Haynes admitted that he participated in a scheme with codefendants Muhammad Kaleem Arshad, M.D., 63, of New Orleans, Padmini Nagaraj, M.D., 61, of Kenner, Louisiana, and others, including patient recruiter Kim Ricard, 52, of Gonzales, Louisiana, and clinic owner Milton Diaz, 66, of Harvey, Louisiana.  Haynes admitted that the purpose of the scheme was to solicit and receive kickbacks and bribes for the referral of Medicare beneficiaries to Progressive Home Health (Progressive), of New Orleans, owned by Diaz, and having them certified as eligible to receive home health services.  In reality, the beneficiares were not eligible to receive such services.  Haynes admitted that he solicited a total of approximately $331,000 in kickbacks from Diaz for Ricard disguised as marketing fees and solicited approximately $1,500 in monthly kickbacks from Diaz for Arshad and Nagaraj disguised as medical director fees.

Arshad pleaded guilty on Feb. 22, 2019 and Nagaraj pleaded guilty on May 2, 2019 before Judge Ashe, to one count each of conspiracy to commit health care fraud.  Arshad’s sentencing is set for July 11, 2019, and Nagaraj’s sentencing is set for Aug. 8, 2019.  As part of their pleas, Arshad and Nagaraj each admitted that in return for accepting illegal health care kickbacks, which Haynes orchestrated, Arshad and Nagaraj each referred beneficiaries that they treated at a Louisiana-based psychiatric facility for medically unnecessary home health services at Progressive, and further fraudulently certified that the beneficiaries were eligible to receive such services.  Diaz, on behalf of Progressive, then submitted the fraudulent claims to Medicare and was reimbursed for the medically unnecessary home health services, he admitted.

Diaz pleaded guilty on July 13, 2017, and is scheduled to be sentenced on July 31, 2019 before U.S. District Judge Jane Triche Milazzo of the Eastern District of Louisiana.  Ricard was found guilty after a three-day trial in September 2017, and was sentenced on Jan. 4, 2018, to 51 months in prison. 

This case was investigated by the FBI and HHS-OIG, and was brought as part of the Medicare Fraud Strike Force, supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Louisiana.  Trial Attorneys Jared Hasten, Katherine Payerle and Claire Yan of the Criminal Division’s Fraud Section are prosecuting the case.

The Medicare Fraud Strike Force is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country.  Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.  In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.